Internationalization of the Russian Economy

The opening up of the previously closed centrally planned economies (CPEs) is one of the most remarkable developments of the 1990s because it means that the last large group of countries previously isolated from the world economy is now part of the globalization process. With the exception of China and Vietnam, however, market reforms and internationalization in former communist countries have been accompanied by mounting economic hardship; output and real incomes fell markedly, and mortality and crime rates increased. In Russia and other former Soviet Union (FSU) states, the costs of transi-tion have been especially high, much higher than in East European countries (Tables 1 and 1A in the Appendix). To what extent were the costs of transition in general and in Russia in particular associated with the opening up of the previously closed economies? Could these costs have been avoided if reformers were pursuing a different strategy of internationalization